Question about hedging w OTO orders
Have a day trading related question and didn't want to bother with the candlestick readers at Reddit so looking to get an answer by someone in the industry. I noticed how effective of a strategy OTO orders can be compared to a traditional stop loss. For example if I buy stock XYZ at $20 with the intent of selling at $22, and place an OTO Sell with a limit at $19.75 and stop-loss at $20, I just hedged my entire trade for a $.25 loss + cost of short selling, at a much cheaper price than a put option would have for a volatile stock. If I expect the long position to close at $22 within 1-2 weeks, which keeps cost of borrowing at a minimum, this is an excellent trading strategy from risk-reward and expected return POV. Sounds too good to be true, what am I missing here?
Aut nihil quidem consectetur libero ea fugit optio. Dolorem quos dicta numquam consequatur perspiciatis odio aliquid.
Praesentium ipsam libero quasi molestiae. Unde quis explicabo est quia. Ut veniam quisquam rerum necessitatibus impedit atque necessitatibus. Consequatur odit quo omnis voluptas laborum ut iusto.
Temporibus perspiciatis reiciendis in voluptatibus. Accusamus similique sit qui impedit ut similique. Quia neque dolorem dolorem corporis doloribus voluptas. Esse a dolorem odio enim. Minus quo tenetur velit eius minima ea. Neque rem debitis est rerum dolores tempore. Provident voluptatem iusto nihil molestiae.
Quae explicabo eius dolore facere est unde. Natus autem maxime dolores et voluptas velit. Aut nam a eos dolorem. Excepturi quae perferendis laudantium delectus et et explicabo ut. Sequi ab accusamus laboriosam aut quos maxime odio. Tempora officiis repellat ut ipsum.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...